What's behind heavy IGT call action
Chris McKhann | [email protected]
optionMONSTER systems show that a trader bought 3,000 July 16 calls for $1.73 against open interest of 3,578 contracts. At the same time, he or she sold 5,000 July 18 calls for the bid price of $0.80 in volume above the open interest in that strike, so that is a position.
This could be a new call spread looking to profit if IGT rallies to $18 but not much beyond. Alternatively, the trader could be rolling a short-call position to a higher strike and increasing its size, possibly part of a covered call strategy. (See our Education section)
IGT is up 0.84 percent to $16.65, approaching the levels of a month ago. The company, which makes casino-game machines, has been trending higher since gapping lower on earnings results in July and bouncing off support at $11.
About 8,800 IGT options have changed hands in the session so far, already about 3 times its daily average for the last month.